Criminal Code Offences in Turkish Capital Markets Cases: Qualified Fraud, Abuse of Trust, Criminal Organisation, Money Laundering and Confiscation

Capital markets cases in Turkey are not prosecuted only under the Capital Markets Law. Alongside insider dealing, market manipulation and the qualified abuse of trust defined in that Law, prosecutors can rely on general offences in the Turkish Criminal Code No. 5237: fraud and qualified fraud (Arts. 157–158), abuse of trust (Art. 155), forming, leading or joining an organisation to commit crimes (Art. 220) and money laundering (Art. 282). These offences do not require SPK’s written application, which is a precondition only for offences defined in or referred to by the Capital Markets Law (Capital Markets Law Art. 115(1)). Qualified fraud carries three to ten years’ imprisonment, increased by half if committed by three or more persons together and doubled if committed within a criminal organisation (Criminal Code Art. 158(1) and (3)). Since July 2026, a person whose part was limited to handing over the access to a bank or brokerage account receives half the penalty (Art. 158(4)). Legal persons cannot be punished, but security measures such as confiscation and licence cancellation can be imposed (Arts. 20(2) and 60). Proceeds of crime can be confiscated only if they cannot be returned to the victim (Art. 55(1)), and returning or compensating the victim’s loss before judgment reduces the penalty for fraud and abuse of trust (Art. 168). This guide explains these rules for foreign institutional investors. It reflects the legislation in force as at 25 October 2026.

Why the Criminal Code matters in capital markets cases

The Capital Markets Law No. 6362 defines its own offences: insider dealing (Art. 106), market manipulation (Art. 107), unauthorised offerings and unlicensed activity (Art. 109), qualified abuse of trust by intermediaries and in related-party dealings (Art. 110), obstruction of SPK (Art. 111) and false accounting and audit reports (Art. 112). These are explained in separate guides in this series. But conduct in a market scandal often goes beyond these definitions. Investors may be deceived into investing, money may be diverted, accounts may be opened in other people’s names, groups may be organised to carry out the scheme, and proceeds may be moved abroad or disguised. Those facts engage the general Criminal Code.

For a foreign institutional investor, the Criminal Code matters for four practical reasons. It determines which conduct can be prosecuted without SPK’s application; it sets the limitation periods that, through Article 72(1) of the Code of Obligations, can extend the time for civil claims; its confiscation rules decide whether recovered proceeds go to victims or to the State; and its effective repentance rules give defendants a reason to compensate victims before judgment.

This guide does not suggest that any person connected with the 2026 fund and market manipulation cases has committed any of the offences described. Investigations are ongoing, and the presumption of innocence applies to everyone concerned.

The legal framework

The Criminal Code has been amended recently in ways that matter here. Law No. 7571 of 24 December 2025 raised the penalties for forming or leading a criminal organisation and for membership (Art. 220). Law No. 7589 of 16 July 2026 added Article 158(4) on persons who hand over access to accounts. The text used for this guide is the consolidated text including these amendments.

Capital Markets Law offences and Criminal Code offences

The two sets of offences differ in their procedure. An investigation into an offence defined in or referred to by the Capital Markets Law requires SPK’s written application to the public prosecutor, which is a procedural precondition; when an indictment is accepted, SPK becomes a participating party (Capital Markets Law Art. 115(1)–(2)). Offences under the Capital Markets Law are tried by criminal courts of first instance designated as specialised courts (Art. 116(1)). Criminal Code offences such as fraud, organisation and laundering are prosecuted by the public prosecutor on the ordinary rules, with no SPK application required; ordinary abuse of trust under Article 155(1) is prosecuted only on complaint.

The same facts can raise both sets of offences. Manipulative trading is defined in Article 107 of the Capital Markets Law; deceiving a particular investor into handing over money may be fraud; the proceeds of either may be laundered; and a group organised to commit them may be a criminal organisation. Where a single act constitutes several different offences, the offender is punished for the one carrying the heaviest penalty (Criminal Code Art. 44), but offences committed through separate acts are punished separately, and members of an organisation are punished both for the organisation offence and for the offences committed within its activities (Art. 220(4)). How SPK’s application works and how a foreign investor takes part in the criminal case are explained in the guide to joining a criminal case.

Fraud and qualified fraud

A person who deceives someone by fraudulent conduct and thereby obtains a benefit for themselves or another, to the detriment of that person or another, is punished with one to five years’ imprisonment and a judicial fine of up to 5,000 days (Criminal Code Art. 157). The core elements are deception through fraudulent conduct, a resulting disposition, loss to the victim or another, and a benefit to the offender or another.

Fraud is qualified, and punished with three to ten years’ imprisonment and a judicial fine of up to 5,000 days, where it is committed in one of the ways listed in Article 158(1). Several of these can be relevant in a financial context:

• ▸ (f) using information systems, banks or credit institutions as instruments;
• ▸ (g) taking advantage of the facilities offered by press and broadcasting;
• ▸ (h) committed by merchants or company managers, or persons acting on behalf of a company, in the course of commercial activities;
• ▸ (i) committed by self-employed professionals abusing the trust placed in them because of their profession;
• ▸ (l) presenting oneself as an employee of a bank, insurer or credit institution, or claiming a connection with them.

In the cases under limbs (e), (f), (j), (k) and (l), the minimum imprisonment is four years and the judicial fine may not be less than twice the benefit obtained from the offence (Art. 158(1), last sentence). Where fraud or qualified fraud is committed by three or more persons together, the penalty is increased by half; where it is committed within the activities of an organisation formed to commit crimes, it is doubled (Art. 158(3)).

Whether any of these limbs applies depends entirely on the facts found by the prosecutor and the court. In particular, fraud requires deception of a person; trading that misleads the market as a whole is addressed more specifically by Article 107 of the Capital Markets Law, which is explained in the guide to market manipulation. Promoting investments through social media and unlicensed advice, where fraud is often alleged alongside capital markets offences, is covered in the guide to social media stock manipulation.

Handing over account access: Article 158(4)

Law No. 7589 of 16 July 2026 added a new paragraph. Where a person’s participation in fraud or qualified fraud is limited to giving another person, in order to obtain an unjust benefit for themselves or another, payment instruments such as bank or credit cards belonging to themselves or another, or the information or tools needed to use an account held at a bank, a brokerage house, a payment service provider or a crypto asset service provider, the penalty is reduced by half (Criminal Code Art. 158(4)).

The provision has two sides. It confirms that handing over account access in order to obtain an unjust benefit is treated as participation in the fraud, and it gives such participants a lower penalty than the principal offenders. In capital markets cases, the use of accounts held in other people’s names is also relevant under the market rules: trading on another person’s account without a notarised power of attorney is a market-disrupting act (Communiqué VI-104.1 Art. 7(2)), and only the client or persons authorised by notarised power of attorney may trade on a brokerage account (Communiqué III-39.1 Art. 29(4)). These rules are explained in the guides to market-disrupting acts and investment services rules.

Abuse of trust

A person who disposes of property belonging to another, which was handed over for safekeeping or for use in a particular way, for their own or another’s benefit and contrary to the purpose of the transfer, or who denies the transfer, commits abuse of trust; the basic offence is prosecuted on complaint and punished with six months to two years’ imprisonment and a judicial fine (Criminal Code Art. 155(1)). Where the property was entrusted by reason of a professional, commercial or service relationship, or because of authority to manage another’s property, the penalty is one to seven years’ imprisonment and a judicial fine of up to 3,000 days (Art. 155(2)).

The Capital Markets Law defines three forms of qualified abuse of trust, for which the penalty under Article 155(2) may not be less than three years (Capital Markets Law Art. 110(1)):

1. (a) selling, using, pledging, concealing or denying, for one’s own or another’s benefit, capital market instruments, cash or other assets deposited or delivered to an investment firm, an asset-financing fund board or a collateral agent, for capital markets activities, as custodian, for management or as collateral;
2. (b) reducing the profits or assets of public companies through concealed transactions with related persons at prices clearly different from arm’s-length prices;
3. (c) reducing, or preventing the increase of, the profits or assets of public companies and collective investment schemes or their subsidiaries through dealings with related persons contrary to arm’s-length terms, market practice and the principles of prudence and honesty, or by generating trading volume.

A person who commits the offence under limbs (b) or (c) and pays the amount to be returned under Article 21(4) plus twice that amount to the Treasury receives no penalty if payment is made before an investigation starts; the penalty is halved if payment is made during the investigation and reduced by one third if made during prosecution before judgment (Art. 110(3)). Destroying, altering or making inaccessible the records of investment firms is a separate offence (Art. 110(2)). Concealed profit transfer is explained in the guide to concealed profit transfer.

Criminal organisation

Persons who form or lead an organisation for the purpose of committing acts defined as crimes are punished with five to ten years’ imprisonment, provided that the organisation’s structure, number of members and means are suitable for committing the intended crimes; an organisation requires at least three members (Criminal Code Art. 220(1)). Members are punished with two to five years’ imprisonment (Art. 220(2)). These ranges were raised by Law No. 7571 of 24 December 2025. Where crimes are committed within the organisation’s activities, they are punished in addition to the organisation offence (Art. 220(4)), and the leaders are also punished as perpetrators of all crimes committed within the organisation’s activities (Art. 220(5)). A person who knowingly and willingly helps the organisation without being part of its hierarchy is punished as a member, with a possible reduction of up to one third (Art. 220(7)).

Article 221 provides for effective repentance. A founder or leader who dissolves the organisation before an investigation starts and before any crime is committed is not punished (Art. 221(1)); a member who leaves voluntarily without having taken part in any crime and reports this is not punished (Art. 221(2)); and a person who surrenders voluntarily and gives information about the organisation’s structure and crimes is not punished for the organisation offence, with a reduction if the information is given after arrest (Art. 221(4)).

The organisation offence matters beyond the penalty. Fraud committed within an organisation is punished at double the rate (Art. 158(3)) and laundering within an organisation at double the rate (Art. 282(4)). Procedurally, an investigation into an organisation offence is among those in which access to the file can be restricted, as explained in the guide to joining a criminal case.

Money laundering

A person who takes abroad assets derived from an offence carrying a minimum penalty of six months’ imprisonment or more, or subjects them to transactions to conceal their illegitimate source or create the impression that they were lawfully acquired, is punished with three to seven years’ imprisonment and a judicial fine of up to 20,000 days (Criminal Code Art. 282(1)). A person who, without participating in that offence, knowingly acquires, accepts, holds or uses such assets is punished with two to five years’ imprisonment (Art. 282(2)). The penalty is increased by half if the offence is committed by a public official or by a professional in the course of their profession (Art. 282(3)), and doubled if committed within an organisation (Art. 282(4)). Security measures apply to legal persons (Art. 282(5)). A person who, before prosecution starts, enables the assets to be seized or tells the authorities where they are is not punished for laundering (Art. 282(6)).

Market manipulation carries a minimum of three years’ imprisonment (Capital Markets Law Art. 107(1)–(2)), as does qualified fraud (Criminal Code Art. 158(1)). Their proceeds can therefore be the subject of laundering. For investors, the laundering offence matters because it extends criminal liability to those who move or hold proceeds, which in turn widens the circle of persons whose assets can be seized and confiscated. The protection of assets during proceedings is explained in the guide to freezing assets.

Companies and other legal persons

Criminal responsibility is personal, and penalties cannot be imposed on legal persons; however, security measures provided by law for offences are reserved (Criminal Code Art. 20). Two security measures are available. Where a private legal person operating under a licence from a public authority benefits from an intentional crime committed with the participation of its organs or representatives through abuse of the licence, the licence is cancelled on conviction; and the confiscation rules also apply to private legal persons for crimes committed for their benefit (Art. 60(1)–(2)). The judge may refrain from these measures where they would be disproportionate to the offence (Art. 60(3)). They apply only where a law expressly provides for them (Art. 60(4)).

For a licensed capital market institution, licence cancellation as a criminal security measure is in addition to SPK’s own administrative powers to stop activities and cancel authorisations (Capital Markets Law Arts. 96 and 97), which are explained in the guide to investment services rules.

Confiscation and the victim’s priority

Items used in an intentional offence, set aside for it or produced by it are confiscated, unless they belong to good-faith third parties; where they have been disposed of or cannot be confiscated, their value is confiscated (Criminal Code Art. 54(1)–(2)). Material benefits obtained through the offence, forming its subject or provided for its commission, and the economic gains from investing or converting them, are confiscated (Art. 55(1)). Where they cannot be seized, their equivalent value is confiscated (Art. 55(2)), and a later acquirer’s property can be confiscated only if that acquirer cannot rely on the good-faith protection of the Civil Code (Art. 55(3)).

The rule that matters most for victims is in the second sentence of Article 55(1): proceeds may be confiscated only if the material benefit cannot be returned to the victim of the offence. Confiscation is therefore subsidiary to restitution. For investors who have lost money, this means that proceeds traced in the criminal proceedings should be claimed for return to the victims, and that the State does not take proceeds that can be returned to them. How seized assets reach victims in practice, and how the criminal seizure relates to civil attachment, is explained in the guide to freezing assets.

Effective repentance

Effective repentance rewards defendants who make good the loss. For theft, damage to property, abuse of trust, fraud and certain bankruptcy offences, if the offender, instigator or accessory personally shows repentance and fully remedies the victim’s loss by returning the property or paying compensation after the offence is complete but before prosecution starts, the penalty is reduced by up to two thirds (Criminal Code Art. 168(1)). If this happens after prosecution starts but before judgment, the penalty is reduced by up to one half (Art. 168(2)). Where restitution or compensation is only partial, effective repentance applies only with the victim’s consent (Art. 168(4)).

The Capital Markets Law has its own effective repentance rules. A person who committed trade-based manipulation and pays the Treasury twice the benefit obtained or caused, and not less than a statutory minimum, receives no penalty if payment is made before an investigation; the penalty is halved during the investigation and reduced by one third during prosecution before judgment (Capital Markets Law Art. 107(3)); a similar mechanism applies to qualified abuse of trust in related-party dealings (Art. 110(3)). Laundering and organisation offences have their own provisions (Criminal Code Arts. 221 and 282(6)).

Article 168 is the provision that most directly benefits victims, because the reduction depends on remedying the victim’s loss and, for partial payment, on the victim’s consent. The role this gives a participating victim in the criminal process is discussed in the guide to joining a criminal case.

Several offences, chain offences and loss of rights

Where the same offence is committed several times at different times against a person in execution of a single criminal decision, one penalty is imposed and increased by one quarter to three quarters; the same applies to offences without a specific victim and where the same offence is committed against several persons by a single act (Criminal Code Art. 43(1)–(2)). Where one act constitutes several different offences, the offender is punished for the offence carrying the heaviest penalty (Art. 44). The judge sets the basic penalty within the statutory range having regard to, among other things, the importance and value of the subject of the offence, the seriousness of the damage or danger and the degree of fault (Art. 61(1)).

A sentence of imprisonment for an intentional offence also carries, as a legal consequence, a bar on acting as manager or auditor of foundations, associations, unions, companies, cooperatives and political parties, and on practising, as a self-employed person or merchant under one’s own responsibility, a profession or trade subject to a public authority’s permission (Art. 53(1)(d)–(e)). For directors and licensed professionals in the capital markets, this is often as significant as the sentence itself.

Limitation of prosecution

Prosecution is time-barred, unless the law provides otherwise, after fifteen years for offences carrying more than five and less than twenty years’ imprisonment, and after eight years for offences carrying up to five years’ imprisonment or a judicial fine (Criminal Code Art. 66(1)(d)–(e)). The upper limit of the statutory penalty is decisive, and aggravating qualifications supported by the evidence in the file are taken into account (Art. 66(3)–(4)). The period runs from the day the offence is committed or, for chain offences, from the day of the last offence (Art. 66(6)).

The table shows the basic periods; aggravations such as commission by three or more persons or within an organisation can raise the upper limit and therefore the period (Art. 66(3)). These periods matter for civil claims as well: where a claim for compensation arises from an act that is a crime for which the criminal law provides a longer limitation period, that longer period applies to the civil claim (Code of Obligations Art. 72(1)). All investor deadlines are collected in the guide to limitation periods.

What this means for investors

A foreign institution that believes it has been the victim of fraud, abuse of trust or another Criminal Code offence can file a complaint directly with the public prosecutor; for these offences, SPK’s application is not needed. Its status in the investigation, its rights to see the file, to object to a decision not to prosecute and to join the prosecution once an indictment is accepted are explained in the guide to joining a criminal case. Being a victim in the criminal case also positions the institution for restitution under Article 55(1) and for the consent role under Article 168(4).

The criminal process and the civil claim run in parallel. A criminal court’s findings on fault and damage do not bind the civil judge, and an acquittal does not bind it either (Code of Obligations Art. 74), but the criminal file is often the best source of evidence. How damages are calculated is explained in the guide to calculating damages.

Points for foreign institutional investors

1. 1. Do not wait for SPK. Criminal Code offences such as fraud can be reported directly to the prosecutor; SPK’s application is required only for Capital Markets Law offences (Capital Markets Law Art. 115(1)).
2. 2. Identify yourself as a victim. Restitution comes before confiscation (Criminal Code Art. 55(1)), and partial compensation by a defendant seeking a reduction needs the victim’s consent (Art. 168(4)).
3. 3. Trace the proceeds. Laundering liability extends to those who knowingly acquire or hold proceeds (Art. 282(2)), and confiscation reaches converted gains and equivalent values (Art. 55(1)–(2)).
4. 4. Check licensed entities. Security measures against legal persons can include licence cancellation (Art. 60(1)); follow both the criminal file and SPK’s administrative measures.
5. 5. Use the longer limitation. Where the conduct is a crime with a longer limitation period, the civil claim benefits from it (Code of Obligations Art. 72(1)); whether the longer criminal period also extends special periods, such as the six-month period for disclosure claims (Capital Markets Law Art. 32(6)), is uncertain, so those periods should be observed.
6. 6. Keep records of representations. Fraud turns on deception; marketing materials, emails and meeting notes showing what was represented are central evidence.

Time limits

Frequently asked questions

Does a fraud complaint in a capital markets case need SPK’s approval?

No. SPK’s written application is required only for offences defined in or referred to by the Capital Markets Law (Art. 115(1)); fraud under the Criminal Code is prosecuted on the ordinary rules.

What is the penalty for qualified fraud in Turkey?

Three to ten years’ imprisonment and a judicial fine of up to 5,000 days, with a four-year minimum and a fine of at least twice the benefit in some cases (Criminal Code Art. 158(1)).

Is the penalty higher if several people acted together?

Yes. For fraud committed by three or more persons together the penalty is increased by half, and within a criminal organisation it is doubled (Art. 158(3)).

What is Article 158(4)?

Added in July 2026, it halves the penalty for a person whose participation in fraud was limited to handing over payment cards or the information or tools needed to use a bank, brokerage, payment or crypto account (Art. 158(4)).

What is the penalty for leading a criminal organisation?

Five to ten years’ imprisonment, and two to five years for members, following Law No. 7571 of December 2025 (Art. 220(1)–(2)).

Can manipulation proceeds be laundered?

Yes. Laundering covers assets derived from offences with a minimum penalty of six months or more (Art. 282(1)); manipulation carries a minimum of three years (Capital Markets Law Art. 107).

Can a company be convicted in Turkey?

No penalties can be imposed on legal persons, but security measures such as confiscation and licence cancellation can be, where a law provides for them (Criminal Code Arts. 20(2), 60, 169 and 282(5); Capital Markets Law Art. 114).

Do confiscated proceeds go to the State or to victims?

Proceeds may be confiscated only if they cannot be returned to the victim (Criminal Code Art. 55(1)).

What is effective repentance in fraud cases?

If the loss is fully remedied before prosecution, the penalty is reduced by up to two thirds; before judgment, by up to one half; partial remedy requires the victim’s consent (Art. 168).

How long can qualified fraud be prosecuted?

Fifteen years from the offence, because the upper limit of the penalty is more than five and less than twenty years (Art. 66(1)(d)).

Related guides

• Turkey’s 2026 Fund and Market Manipulation Crisis: Legal Guide for Foreign Institutional Investors — the entry point to this series
• Turkish Currency Law and Repatriation of Investment Proceeds
• Turkish Book-Entry Securities and the Central Registry (MKK)
• Borsa Istanbul Trading Rules: The Equity Market Directive
• Joining a Criminal Case in Turkey as a Foreign Investor
• Market Manipulation under Turkish Law: Article 107
• Freezing Assets in Turkey
• Social Media Stock Manipulation and Unlicensed Investment Advice
• Concealed Profit Transfer in Turkey: Article 21
• Market-Disrupting Acts in Turkey: Article 104 and Communiqué VI-104.1
• Investment Services Rules in Turkey: Communiqués III-37.1 and III-39.1
• Calculating Damages in Turkish Securities Claims
• Limitation Periods for Investor Claims in Turkey